When the Covid-19 pandemic took hold, the way many in the food industry worked changed overnight. Some of those changes have persisted but businesses still have plenty to ponder.
For white-collar workers, spare bedrooms became offices and kitchen tables became boardrooms, as colleagues held high-level virtual meetings with co-workers over Teams or Zoom.
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By GlobalDataNormal life continued for blue-collar workers on production lines in factories who couldn’t do their jobs remotely. At least, as much as possible. They had to get to grips with stringent social distancing measures and hygiene rules to ensure businesses continued to tick over during repeated lockdowns.
Two years on, as we slowly learn to live with the virus, food groups are finally able to start looking ahead to the future and map out how to structure their workforce and reshape their business in the new normal.
For many food groups, the measures they introduced during the pandemic were not entirely alien concepts. As the spokesperson for one global company points out: “The pandemic didn’t necessarily change a huge amount for us – it just accelerated certain things. Automation in factories, remote assistance, remote work via augmented reality – all these types of things were already starting to happen before Covid and they just got accelerated by the pandemic.
“Flexible working patterns, hybrid work and homeworking were also already very much on-trend before Covid but they were accelerated due to the pandemic. The adoption of the kind of technology that facilitates those things – like Zoom and Teams – definitely got accelerated and improved significantly thanks to Covid.”
And as things slowly return to normal – or as normal as things can be with Covid-19 still prevalent and having varied impacts the world over depending on how governments are still choosing to tackle the virus – the picture today looks very similar to what it looked like in the early part of 2020 for many food groups. As a spokesperson for one large European food manufacturer says: “Our production post-Covid is running more or less like pre-Covid.”
Change has happened
While there may be an air of familiarity about how companies operate, some things have irrevocably changed over the last two years. For starters, the global food group spokesperson says remote working for the majority of white-collar workers is here to stay.
“Some parts of our workforce are no longer strongly bound to a location to do their job,” explains the spokesperson. “So, office workers, sales forces, and so on – they can do a lot of their work remotely. It’s not fully shaken out yet but one might argue that Covid and the spectre of the possibility of having these kinds of communicable diseases, proliferating more in the future, has led to a greater appetite for and a greater acceptance of remote working.”
Obviously, it’s not possible for all workers to operate remotely, especially blue-collar workers. But, whereas in the past these blue-collar staff may have been viewed as more dispensable than their white-collar colleagues, some industry watchers believe the situation has radically changed. The retention of skilled workers and production workers has become a key area of focus for food groups, they argue.
“That plays into all sorts of things such as having fewer temporary workers and having a more long-term and strategic recruitment of younger talent – be that apprentices, or graduates,” says Clive Black, head of research at Shore Capital Markets and a veteran observer of the grocery market. “[We could see] a pivot to more permanent rather than flexible workers as labour becomes a big factor. I also think there will be a delayering of management because management is much more expensive than operatives.”
Another key area of focus for food groups will be the ‘reskilling’ of workforces, believes Oliver Grange, strategy and consulting lead for consumer goods for Accenture in the UK. “You’ve seen big efforts from some large CPGs to reskill their employees at scale, leveraging the sorts of digital learning technology that you wouldn’t have had ten or 15 years ago.”
Grange thinks there will be a greater emphasis on employee experience as the battle to attract and retain talent heats up. “I think that that concept of employee experience was maybe paid lip service historically, but I don’t think it is anymore,” he says. “They’ve realised that having high-quality employees who are incented and trained and retrained – because everybody needs to be upskilled, on an ongoing basis these days – is just a good, positive investment.”
This type of investment is already a key area for Mondelez International. “Our hiring practices have always focused on assessing for growth mindset and leadership potential. These practices hold us in good stead as we ready ourselves for a post-Covid world,” Andrea Kain, the snacks giant’s vice president for global talent acquisition, insists. “Our inherent strengths of a winning growth culture that encourage passion and personality, our flexible working and employee wellbeing policies will become even more important as we look to attract a diverse, multi-generational talent base. We are increasingly exploring location-agnostic roles and gig/alternate work models which allow us to be more nimble and agile.”
Cyrille Filott, global strategist consumer foods, packaging and logistics at Rabobank, says a big challenge for food majors like Mondelez is coming up with answers to a number of major questions around their labour needs, both now and in the future – particularly when it comes to issues surrounding the ongoing shortage of skilled workers.
“How do I attract talent or people for the jobs? Do I need to pay more? Do I need to change labour conditions? Do I need to offer more flexible work hours, even for skilled jobs?” he asks, rhetorically.
Filott believes one solution to the skills shortage could be the creation of academies where businesses train up people internally “to give them more job satisfaction and give them more prospects of growing within a business”.
A spokesperson at DMK, Germany’s biggest dairy company, says in addition to its existing training and development tools to strengthen the skillset of employees, the company has set up programmes such as a “young professional academy and a mentoring programme”.
The question of automation
In addition to a greater focus on developing skills in-house, as labour becomes increasingly more expensive, it’s inevitable it will push more food groups towards exploring the possibility of introducing greater levels of automation across their operations and especially on production lines in factories.
Many food groups were significantly impacted by workers falling ill during the pandemic or were forced to reduce production capacity because they could only accommodate a limited number of workers on factory floors due to social distancing. Filott thinks a lot of food groups are weighing up the risk-reward equation on investing in expensive, highly automated equipment.
“In April 2020, I got a phone call from a company in Europe – so the pandemic was only six weeks old – saying ‘how should I think about my workforce because 25% of my workforce isn’t here [due to Covid]’, which I thought was a brilliant question,” says Filott. “‘Do I need to have a structural rethink and, whenever this is over, do I need to think about my workforce differently? Do I need to add a risk component, theoretically, about labour because there’s a higher risk of people not turning up because of this pandemic, or in a future pandemic?’ Continuity is key and yes, capital equipment is very expensive, but the risk-reward might be changing.”
Black has also detected a shift in companies’ attitudes towards rolling out technology, a change caused partly by the pandemic. “At the coalface, it is about automation, and digitisation,” he says. “Digitisation allows for more replacement of people in white-collar jobs and in administration jobs. But, on the automation front, even if you had great plans to try and get machinery out of northern Italy, or Germany at the moment, it’s going to take you two to three years [due to an ongoing shortage of machines and key machinery components]. If you are able to get a machine into the UK, it will probably take you two to three years to find an engineer to install it!”
The DMK spokesperson says “ongoing digitisation” has already changed the way people live and work across the business. “Work is becoming more flexible in terms of location and time, communication with colleagues in other countries easier, borders more fluid. As food manufacturers, we need to transform our workplaces so that employees can develop in such an environment. This applies to office workplaces as well as to colleagues in the dairies. A shared sense of ‘we’ is an important part of this. For example, colleagues are not necessarily located in one place, sometimes abroad, but are expected to work on the same processes or projects. This is not easy and requires understanding and team spirit.”
He adds DMK is now “incorporating all these insights” into the design of its new corporate headquarters in Bremen. The cooperative is looking at “creating perfect conditions for the ‘new way of working’”. The premises will “on the one hand allow agile working, conversation, encounters and networking, and on the other hand, enable retreat and concentration. Because the office is transforming into an anchor point for infrastructure, exchange and social contacts.”
The problem is whether companies decide to improve the layout and infrastructure of their offices to facilitate hybrid working, invest in greater levels of digitisation, buy more equipment to increase the level of automation in their factories, or decide to invest heavily in attracting and retaining talent – or indeed pursue all of these options – they don’t come cheap. As Filott points out “it is a fact that your costs will have to go up”.
With Covid-19 infections still on the rise in some countries across the globe and with many governments yet to remove all pandemic-related restrictions, it’s still too early to predict with any degree of certainty how the workforce of global food groups will shape up over the coming years.
Filott points out that a few months ago no-one could have envisaged millions of Ukrainians moving to western Europe, where they could potentially settle, seek employment and play a key role in addressing the labour shortage in some countries. As a result, many food groups will be keeping a watching brief to see how things pan out as we learn to live with Covid over the coming years.
